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The Role of Culture in Shaping Managerial Overconfidence and Its Impact on Financing Decisions

Year: 2024

Type: article

Abstract: Traditional economic models that assume rational decision-making may not accurately capture the complexities of real-world financial decision-making. Behavioral Decision Theory can explain the gap between classical capital structure theories and inconsistent empirical evidence. Under the assumption of bounded rationality Behavioral Decision Theory linking cultural values, overconfidence and financial decision making. Culture is an important aspect in organization which need close attention. Culture play a vital role in shaping behavioral biases. Overconfidence is one of the well-known cognitive biases in financial decision making that often seen in managers. Cultural differences and managerial overconfidence have impact on financing decisions.

Source: Jurnal Riset Akuntansi Aksioma

DOI: 10.29303/aksioma.v23i2.435

Authors: G. A. Sri Oktaryani, Siti Sofiyah Abdul Mannan

Institution: University of Mataram

Language: English

Topic: Corporate Finance and Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: diamond

OpenAlex ID: W4405110339

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